Strict construction of refund notifications bars CHA service tax refund and treats later amendment as prospective only.

Refund of service tax on CHA services was not admissible under Notification No. 41/2007-ST for the relevant period because CHA services were not among the eligible services then specified. The refund claim was also barred by the proviso denying benefit where drawback of service tax on the specified services had been availed, and exports under All Industry Rate drawback brought the claim within that restriction. Deletion of the proviso by Notification No. 33/2008-ST was held to operate prospectively only, absent express or implied retrospective intent, so it did not revive claims for the earlier period.

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Issues: (i) whether refund of service tax paid on CHA services was admissible under Notification No. 41/2007-ST for the relevant period; (ii) whether the refund claim was barred by the proviso denying benefit where drawback of service tax on specified services had been availed, and whether deletion of that proviso by Notification No. 33/2008-ST operated retrospectively.

Issue (i): whether refund of service tax paid on CHA services was admissible under Notification No. 41/2007-ST for the relevant period.

Analysis: The notification, as applicable during January 2008 to March 2008, did not specify CHA services among the eligible services. A refund claim can succeed only within the scope of the notification in force during the relevant period.

Conclusion: Refund in respect of CHA services was not admissible.

Issue (ii): whether the refund claim was barred by the proviso denying benefit where drawback of service tax on specified services had been availed, and whether deletion of that proviso by Notification No. 33/2008-ST operated retrospectively.

Analysis: The exports were made under All Industry Rate drawback, and the relevant proviso to Notification No. 41/2007-ST expressly denied refund where drawback of service tax on the specified services had been availed. The proviso remained in force during the relevant period. Deletion of the proviso by Notification No. 33/2008-ST was held to be prospective in the absence of any express or implied retrospective operation.

Conclusion: The refund claim was barred by the proviso and the subsequent deletion did not assist the claimant retrospectively.

Final Conclusion: The refund claim failed on the governing notification as it stood during the relevant period, and the appeal was rejected for want of merit.

Ratio Decidendi: A refund under an exemption or rebate notification is governed strictly by the conditions in force during the relevant period, and an amending notification operates prospectively unless retrospective intent is expressly or impliedly provided.

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